State of SMB IT Report: Spending's Up

The latest semi-annual report on small and medium business technology trends by Spiceworks is now available. This latest installation of the free report comes packed with 14 pages of findings and summarizes the responses from more than 1,250 IT professionals in SMBs from across the world.

Data was collected in January and February 2010, which makes this report a good indication of the state of the industry as SMBs pick up the pieces from the financial meltdown that plagued 2009.

Some key findings that can be gleaned from the report are as follows:

Budgets for 2010 are up an average of 9 percent over 2009.

80 percent of SMB IT professionals plan to purchase new hardware.

44 percent of companies state that they already use virtualization; another 21 percent plan to invest in new virtualization software.

23 percent plan to purchase or renew their e-mail hosting solution, making it the most popular form of hosted service.

Over 70 percent of IT departments plan to accomplish their goals this year with the same or fewer staff compared to last year.

Based on the above findings, here is my take on the state of small and mid-sized businesses:

SMB spending up

This could be a spillover effect from the belt-tightening that took place last year, in which companies streamlined budgets and put unnecessary purchases on hold. At least some of the deferred hardware refreshes must be making themselves felt by now, and companies are replacing aging hardware or performing preventive upgrades now that the economy is better.

According to the report, most of these hardware purchases center around core hardware such as desktops, laptops, and servers.

Virtualization now mainstream in SMBs

As the report puts it, "virtualization has crossed the chasm in the small and medium business" and is being used in core IT functions on the network. In a nutshell, SMBs are no longer experimenting or conducting trials of virtualization. Aware of its benefits, SMBs are implementing the technology to replace common infrastructure such as DHCP, DNS, WSUS, or even active directory, LDAP and other authentication schemes.

While more projects, purchases and various IT-related activities are taking place, no increase in staffing is expected. While to some degree companies are hiring, SMBs appear cautious in adding to headcounts. This is especially true with mid-sized businesses, where more than 70 percent say they have no plans to increase their IT staffs.